DSIP List. Dividend Histories. Commentary from ASG's Equity Sector Analysts. January 2014

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1 Joseph E. Buffa, Equity Sector Analyst Michael A. Colón, Equity Sector Analyst January 2014 DSIP List Commentary from ASG's Equity Sector Analysts Dividend Histories The Diversified Stock Income Plan (DSIP List) focuses on companies that we believe will provide consistent annual dividend growth over a long-term investment horizon. Our objective is to provide a broad list of high quality, industry leading companies from which an investor can assemble a welldiversified portfolio. Through consistent dividend growth, our goal is to help investors stay ahead of the wealth eroding effects of inflation. Many DSIP List companies tout a long history of providing investors with a rising stream of income through annual dividend growth. In Table 1 on pages 2-4, we list the calendar year dividends paid since 2007 for each company included on the DSIP List at the beginning of We also provide the historical one-year, threeyear, five-year and 10-year dividend growth rates for each company. At the bottom of the table, we provide the compound annual growth rate of the U.S. Consumer Price Index, a common measure of inflation. Although it is not our intent that investors own every company on the DSIP List, the average annual dividend growth of companies on the DSIP List has historically surpassed the rate of inflation; and we believe that by holding a diversified portfolio of DSIP List stocks, investors may potentially keep ahead of the rising cost of living. Please note: Not every company has been on the DSIP List over the entire period for which we provide dividend information. The initial dividend year for a company may include fewer than four quarters of dividends. We have excluded special dividends and have adjusted for dividends that happen to fall into the following calendar year where appropriate. Dividends shown for ADRs are net of taxes, fees, etc. as calculated by the data provider. The data is based on the dividend s record date the date an investor must own the shares to be entitled to receive the dividend. The 2016 Consumer Price Index is through November. Abbott Laboratories distributed shares of a subsidiary, AbbVie, Inc., to shareholders in January A portion of Abbott's dividend was assumed by AbbVie, creating the appearance of a large dividend cut by Abbott for Novartis 2013 and 2015 dividends are great examples of currency fluctuations affecting dollar distributions. In its home currency, Swiss francs, Novartis increased its dividend 2.2% in 2013 and 6.1% in Both increases were more than offset by strength in the U.S. dollar. Investment and Insurance Products: NOT FDIC Insured NO Bank Guarantee MAY Lose Value Please see pages 5-6 of this report for Important Disclosures, Disclaimers and Analyst Certification Page 1 of 6

2 Table 1 Annual Dividends per Share Annual Dividend* CAGR** yr 3-yr 5-yr 10-yr CONSUMER DISCRETIONARY Comcast Corp Class A (CMCSA) % 13% 20% - Lowe's Companies (LOW) % 23% 20% 23% McDonald's Corp (MCD) % 5% 7% 14% NIKE, Inc (NKE) % 15% 15% 15% Polaris Industries (PII) % 9% 20% 14% Target Corp (TGT) % 14% 16% 18% TJX Companies Inc (TJX) % 22% 22% 22% V.F. Corp (VFC) % 19% 19% 12% Walt Disney Company (DIS) % 20% 20% 17% CONSUMER STAPLES Brown-Forman Corp (BFB) % 9% 10% 9% Clorox Co (CLX) % 5% 6% 10% Colgate-Palmolive Co (CL) % 5% 6% 10% Costco Wholesale Corp (COST) % 13% 14% 13% CVS Health Corp (CVS) % 24% 28% 28% General Mills Inc (GIS) % 9% 10% 10% J.M. Smucker Co (SJM) % 9% 9% 10% Kellogg Co (K) % 4% 4% 6% Kimberly-Clark Corp (KMB) % 4% 6% 7% McCormick & Co Inc (MKC) % 8% 9% 9% Pepsico Inc (PEP) % 10% 8% 10% Proctor & Gamble Co (PG) % 4% 5% 8% SYSCO Corp (SYY) % 3% 4% 6% Wal-Mart Stores Inc (WMT) % 2% 6% 12% ENERGY Exxon Mobil Corp (XOM) % 7% 10% 9% Phillips 66 (PSX) % 23% - - Schlumberger NV (SLB) % 17% 15% 15% FINANCIALS AFLAC Inc (AFL) % 5% 6% 12% BlackRock, Inc (BLK) % 11% 11% 18% Brown & Brown Inc (BRO) % 11% 9% 9% Chubb Limited (CB) % 9% 13% 11% Commerce Bancshares Inc (CBSH) % 5% 5% 4% Eaton Vance Corp (EV) % 9% 8% 10% FactSet Data Services Inc (FDS) % 13% 13% 24% T. Rowe Price Group (TROW) % 12% 12% 15% Page 2 of 6

3 Table 1 Annual Dividends per Share (continued) Annual Dividend* CAGR** yr 3-yr 5-yr 10-yr HEALTH CARE Abbott Laboratories (ABT) % 23% -11% -1% AmerisourceBergen Corp (ABC) % 17% 25% 36% Amgen Inc (AMGN) % 29% 48% - Becton, Dickinson & Co (BDX) % 10% 10% 12% Johnson & Johnson (JNJ) % 7% 7% 8% Medtronic plc (MDT) % 14% 12% 15% Novartis AG (NVS) % 4% 3% 12% Stryker Corporation (SYK) % 12% 16% 22% INDUSTRIALS 3M Co (MMM) % 20% 15% 9% Caterpillar Inc (CAT) % 11% 11% 11% Emerson Electric Co (EMR) % 5% 6% 7% General Dynamics Corp (GD) % 11% 10% 13% Illinois Tool Works Inc (ITW) % 14% 11% 12% United Parcel Service Inc (UPS) % 8% 8% 7% United Technologies (UTX) % 6% 7% 10% W.W. Grainger Inc (GWW) % 10% 14% 16% INFORMATION TECHNOLOGY Accenture Ltd (ACN) % 10% 15% 21% Analog Devices Inc (ADI) % 7% 12% 11% Automatic Data Processing Inc (ADP) % 7% 8% 12% Broadridge Financial Solutions, Inc. (BR) % 17% 15% - Cisco Systems, Inc (CSCO) % 15% 41% - Harris Corp (HRS) % 9% 14% 19% Int'l Business Machines Corp (IBM) % 14% 14% 17% Jack Henry & Associates Inc (JKHY) % 15% 22% 18% Microsoft Corporation (MSFT) % 15% 17% 15% Paychex Inc (PAYX) % 9% 7% 10% QUALCOMM Inc (QCOM) % 17% 20% 16% MATERIALS Air Products and Chemicals Inc (APD) % 7% 9% 10% AptarGroup Inc (ATR) % 7% 9% 11% Ecolab Inc (ECL) % 14% 14% 13% PPG Industries (PPG) % 9% 7% 5% Praxair Inc (PX) % 8% 8% 12% Page 3 of 6

4 Table 1 Annual Dividends per Share (continued) Annual Dividend* CAGR** yr 3-yr 5-yr 10-yr REAL ESTATE American Tower Corporation (AMT) % 25% - - Federal Realty Investment Trust (FRT) % 9% 7% 5% Realty Income Corp (O) % 3% 7% 5% TELECOMMUNICATIONS AT&T Inc (T) % 2% 2% 4% Verizon Communications Inc (VZ) % 3% 3% 3% UTILITIES Edison International (EIX) % 13% 9% 6% Eversource Energy (ES) % 7% 10% 9% National Fuel Gas Co (NFG) % 3% 3% 3% New Jersey Resources Corp (NJR) % 6% 6% 7% NextEra Energy Inc (NEE) % 10% 10% 9% SCANA Corp (SCG) % 4% 3% 3% South Jersey Industries Inc (SJI) % 6% 7% 9% Southern Company (SO) % 3% 3% 4% Wisconsin Energy Corp (WEC) % 11% 14% 16% Xcel Energy Inc (XEL) % 7% 6% 4% Averages: 9% 11% 11% 12% Consumer Price Index % 1.0% 1.5% 1.9% * Calendar year dividends determined by record date other than for MDT which uses pay date. ** Compound annual growth rate 1 ABT distributed shares of ABBV to shareholders in January A portion of ABT's dividend was assumed by ABBV. The total dividends paid by ABT and ABBV on a combined annual basis was $2.16 for Q through November Source: FactSet, Federal Reserve Bank of St. Louis, Wells Fargo Advisors Page 4 of 6

5 Disclosures Disclosure information... For important disclosure information, please contact: Wells Fargo Advisors Attn: Advisory Services (Disclosure Information) One North Jefferson, St. Louis, MO Or call phone (888) Please remember to specify the issuer(s) with respect to which you would like to receive disclosure information. Analyst or a household member owns a long common equity position in Walt Disney Company (DIS). ANALYST CERTIFICATION: The Analyst who prepared this report hereby certifies that the views expressed in this report accurately reflect his/her personal views about the subject companies and their securities. The Analyst also certifies that he/she has not been, is not, and will not be receiving direct or indirect compensation for expressing the specific recommendation(s) or view(s) in this report. Disclaimers The Diversified Stock Income Plan (DSIP) is a preselected, regularly reviewed list of stocks with what ASG believes are attractive current yields, chosen based on the likelihood of the companies to consistently raise their annual dividends. Dividends are not guaranteed and are subject to change or elimination. American depositary receipt (ADR) is a stock that trades in the United States but represents a specified number of shares in a foreign corporation. ADRs are bought and sold on American markets just like regular stocks, and are issued/sponsored in the U.S. by a bank or brokerage. If the home currency is devalued, this can result in a loss to the ADR holder, even if the company had been performing well. Due to currency exchange rate fluctuations, dividends can also vary significantly period to period. Investments in the energy sector are subject to the adverse economic events within that industry. A downturn in the energy sector of the economy, adverse political, legislative or regulatory developments or other events could have a large impact on a portfolio s investments in this sector. Investing in foreign securities presents certain unique risks not associated with domestic investments, such as currency fluctuation and political and economic changes. This may result in greater share price volatility. These risks are heightened in emerging markets. Technology and internet-related stocks, especially of smaller, less-seasoned companies, tend to be more volatile than the overall market. There are special risks associated with an investment in real estate, including the possible illiquidity of the underlying properties, credit risk, interest rate fluctuations and the impact of varied economic conditions. You should be aware that investments can fluctuate in price, value and/or income, and you may get back less than you invested. We recommend that existing shareholders consider their objectives, their risk tolerance, and the size of their positions relative to their portfolios when evaluating their holdings. Wells Fargo Advisors publishes several theme-based lists of recommended equity securities. Each list is based on a specific investment objective and time horizon which may be different from the other lists. This may cause Wells Fargo Advisors to recommend an equity security to be added to one list and removed from another list. Thus, one list may contain different recommendations or conclusions that could result in short-term price movements contrary to the recommendations in another list. Wells Fargo Advisors research analysts receive no compensation in connection with the firm s investment banking, sales and trading, or principal trading revenues. Analysts may be eligible for annual bonus compensation based on the overall profitability of the firm, which takes into account revenues derived from all the firm s business activities, including its investment banking business, sales and trading, and principal trading. The Advisory Services Group (ASG) of Wells Fargo Advisors works with information received from various resources including, but not limited to, research from affiliated and unaffiliated research correspondents as well as other sources. ASG research analysts provide investment advice based on their own observations and analysis (both fundamental and quantitative) for the Page 5 of 6

6 clients of Wells Fargo Advisors and its affiliates. ASG does not assign ratings to or project target prices for any of the securities mentioned in this report. ASG receives research from affiliated and unaffiliated correspondent research providers with which Wells Fargo Advisors has an agreement to obtain research reports. Each correspondent research report reflects the different assumptions, opinions, and the methods of the analysts who prepare them. Any opinions, prices or estimates contained in this report is as of the date of this publication and is subject to change without notice. Additional information available upon request. Past performance is not a guide to future performance. The material contained herein has been prepared from sources and data we believe to be reliable but we make no guarantee as to its accuracy or completeness. This material is published solely for informational purposes and is not an offer to buy or sell or a solicitation of an offer to buy or sell any security or investment product. Opinions and estimates are as of a certain date and subject to change without notice. Wells Fargo Advisors is registered with the U.S. Securities Exchange Commission and the Financial Industry Regulatory Authority, but is not licensed or registered with any financial services regulatory authority outside of the U.S. Non-U.S. residents who maintain U.S.-based financial services account(s) with Wells Fargo Advisors may not be afforded certain protections conferred by legislation and regulations in their country of residence in respect of any investments, investment transactions or communications made with Wells Fargo Advisors. Wells Fargo Advisors is a trade name used by Wells Fargo Clearing Services, LLC and Wells Fargo Advisors Financial Network, LLC, Members SIPC, separate registered broker-dealers and non-bank affiliates of Wells Fargo & Company Wells Fargo Clearing Services, LLC. All rights reserved. Page 6 of 6